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Fighting an Incurable Disease

United Therapeutics(NASDAQ:UTHR) is trying to become a one-stop-shopping source for treating an incurable type of high blood pressure that can lead to heart failure and death.

It has one drug, Remodulin, on the market for pulmonary arterial hypertension (PAH), which is abnormally high pressure in the vessels taking blood from the heart to the lungs. On Tuesday, it received Food and Drug Administration approval for another, Adcirca. In July, the company expects to hear from the FDA on a third product, and it has several compounds in clinical trials.

Quite often, a company staking out a niche for a relatively rare disease -- there are only about 1,000 new PAH cases per year in the United States -- won't have much competition. But that's not the case for United Therapeutics.

Adcirca, the newest drug, is the seventh brand-name product in the U.S. market according to Sagient Research Systems. It was licensed from Eli Lilly(NYSE:LLY), and the same active ingredient is used in Lilly's impotence drug Cialis. Many other drugs are being tested, including several in phase 3 clinical trials.

A competitive marketOther players include GlaxoSmithKline(NYSE:GSK) and its Flolan, Pfizer's (NYSE:PFE) Revatio, containing the same ingredient as Viagra, Gilead Sciences(NASDAQ:GILD) with Litairis, and Switzerland's Actelion and its drug Tracleer. Novartis(NYSE:NVS) and Biogen Idec(NASDAQ:BIIB) are also getting into the game with drugs in early trials.

That's a lot of attention for a disease that the FDA says affects only 100,000 Americans, but there's no one-size-fits-all drug here. All PAH drugs seek to increase blood flow in the arteries of the lungs and/or prevent clots and arterial scarring, but patients have different responses to different medications. Some drugs, like Adcirca, treat early stages of PAH. Others, like United Therapeutics' injectable Remodulin, treat moderate to severe cases.

Although United Therapeutics is working on treatments for cancer and infectious diseases, it is clearly staking its corporate health on PAH. That means the stock can be elevated or pummeled by a headline. The stock gained 12% on Tuesday following the FDA's approval of Adcirca. But last Nov. 17, the stock fell 35% after a late-stage clinical trial didn't meet its research goals.

Diversity and convenienceUnited Therapeutics wants to find other ways to administer Remodulin. Because this drug (and other drugs for severe PAH) are delivered via catheter, patients run the risk of potentially fatal bloodstream infections. The company plans to re-test the Remodulin pill compound, but Martine Rothblatt, the chairman and CEO, said earlier this year that the pill wouldn't be ready until 2013 or 2014.

That leaves United Therapeutics banking on an expected late July FDA ruling for an inhaled version of Remodulin called Tyvaso. The agency was supposed to decide in April, but it required more time.

During its history as a publicly traded company, United Therapeutics has seen its stock occasionally behave like an erratic electrocardiogram as it depended on clinical-trial results. FDA approval of Tyvaso should offer a steady (upward) beat for investors and, more importantly, heartfelt thanks from patients.